Novidea, a leading provider of cloud-based, data-driven insurance management platforms, has conducted a thorough analysis revealing that 75% of insurance organizations worldwide are preparing to adopt new core insurance management platforms within the next two years.
The findings stem from a comprehensive report titled “Legacy Out, Digitalization In: The State of Modern Insurance Technologies 2024.” This report, based on a 2023 survey involving 330 full-time C-level leaders in the insurance industry across eight countries, delves into the challenges faced by insurance organizations dealing with aging, disparate technology. The struggle to manage, scale, and leverage these systems poses difficulties for leaders striving to keep pace with the demands of modern digital transformation.
On average, organizations currently manage six different insurance technology systems, with these systems having an average age of at least five years. Consequently, leaders have invested in employee training to maximize the value extracted from these technology systems, a task made even more challenging with remote work becoming the norm.
Roi Agababa, CEO of Novidea, commented on the findings, stating, “The data shows that insurance leaders are ready to make future-forward decisions about the technological shift required to better meet customers’ expectations of a modern, digital-first experience. As the survey shows, there is a clear acknowledgment that current systems are aging, disconnected, and do not support today’s digital demands.”
Key findings from the report include:
- 76% of enterprise insurance organizations with over 5,000 employees manage between 6 and 10 insurance technologies or more.
- Approximately 40% of insurance agency/broker management platforms and policy administration systems have been in use for 5 to 15 years.
- 99% of global insurance organizations plan to overhaul their core technology systems, with 41% initiating upgrades within the next 12 months and an additional 34% planning changes by 2025.
- In the US insurance market, less than 25% of enterprise insurance organizations express confidence in their existing technology’s compliance support, with 77% finding it helpful only “some of the time” in the intricate regulatory landscape.
- When addressing primary challenges with current technology systems, insurance leaders identified issues such as data quality (41%), data privacy and security (35%), and scalability (35%). CEOs particularly expressed heightened concern about scalability, with 50% identifying it as a top challenge compared to 33% for the rest of the C-suite.
